ComfortDelGro to raise taxi commissions for booked rides to 7%

TRANSPORT operator ComfortDelGro will increase its commissions from cabbies to 7 per cent from 5 per cent from Jan 1, 2024. This will be applicable to app and phone-booked rides.

The hike was reported by Chinese language daily Lianhe Zaobao on Dec 26 and follows a fare increase and extended surcharge hours aimed at helping taxi drivers defray higher operating costs. ComfortDelGro said the revised fares and surcharge hours will contribute to higher earnings for drivers.

In the story, ComfortDelGro cited higher cost of operations in maintaining and upgrading technology systems and higher financial charges for cashless transactions as reasons for the increase. The company will waive commissions on all fares S$9 and below from Jan 1 to Mar 31 to cushion the impact on drivers.

It will be making the existing 10 per cent rental waiver permanent for its drivers from Jan 1 as well.

“This change, combined with the enhanced loyalty scheme of daily rental reductions and rental-free days introduced in April 2023, will lead to more savings for most cabbies, even after accounting for the 1 per cent GST hike and the increase in commissions,” said a company spokesperson.

The raising of commissions goes counter to ComfortDelGro’s ride-hailing rivals. Gojek has cut commissions to 10 per cent to at least the end of 2024, while Ryde will be forgoing commissions altogether until the end of next year.

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The 2 per cent increase in commissions would mean an additional S$0.40 on top of the S$1 paid to ComfortDelGro for a S$20 ride. A driver would have to pay S$28 to the company if he completes 20 such rides, S$8 more than what is payable now.

This would equate to an extra amount of around S$70,400 a day from ComfortDelGro’s fleet of about 8,800 taxis, or S$25.7 million more a year.

In its recent Q3 2023 results, ComfortDelGro’s taxi and private hire operating profit saw a boost from platform fees introduced for Singapore taxis on Jul 1. Operating profit excluding non-recurring items hit S$28.5 million in the third quarter, up from S$25.8 million in the second quarter despite having similar booking volumes of 8.1 million.